31 May 2018 07:00
31 May 2018
AIM: SHRE
Share plc
("Share", the "Group" or "the Company")
Trading Update
Share, which operates The Share Centre Limited ("The Share Centre"), a leading independent retail stockbroker, today provides an update on trading for the first quarter of the financial year ending 31 December 2018, including data on the Group's performance relative to a wider peer group of 15 other retail stockbroker peers*, as measured by Compeer Limited, the independent business performance benchmarking company.
Overview
The Company continues to make good progress and trading in Q1 was in line with management expectations, with revenues up by 20% year-on-year. This increase reflected the benefit of the launch of services for Computershare in May 2017 and healthy trading volumes.
Assets held on behalf of customers rose by 16% to £4.6bn year-on-year. This compares favourably to the FTSE All-Share Index, which decreased by 2% over the same period.
The Company's market share of its wider peer group's* revenues (excluding interest) was 3.54% for Q1 (Q1 2017: 3.66% and Q4 2017: 4.13%). Including interest, Share's market share in Q1 was 3.38% (Q1 2017: 3.19% and Q4 2017: 3.71%).
In April, we completed a significant upgrade to our website, www.share.com, which has improved both existing and prospective customer experience of the site. Further improvements to functionality are scheduled to take effect later in the year.
Review of revenue and performance
- Dealing commission (which currently accounts for 58% of Group revenues) increased by 27% relative to Q1 2017. This growth was supported by a full quarter of the Computershare services that were launched in May 2017. Trading volumes across The Share Centre platform were up by 5% on Q1 2017.
These results compare favourably with the wider peer group*, where trading volumes decreased by 4% and dealing commission declined by 7%.
- Fee income (which accounts for 34% of Group revenues) decreased by 1% relative to Q1 2017. Following the sale of Sharefunds Limited in April 2017, whilst the majority of its revenue remained within the Group, fee income was reduced with the transfer of our non-core Authorised Corporate Director role. The peer group* experienced a rise of 49% in fee income over the same period. This pronounced rise mainly reflected a change in charging rates/structures by particular peer group members. Overall, The Share Centre's flat fee model continues to highlight the cost-effectiveness of our services for personal investors and we continue to see good rates of account opening.
- Interest income (which now accounts for 8% of Group revenues) increased by 160% relative to Q1 2017. This rise was driven by both the base rate increase to 0.50% from 0.25% in November 2017 and the rule change in the FCA Client Assets Sourcebook, which now allows brokers to deposit a proportion of their client money balances for up to 95 days. The Share Centre currently holds client money balances of c.£400m, and therefore interest income and Group profitability could materially benefit from any further increases in interest rates. Interest income for the peer group* decreased by 15%.
*Market share data has been independently compiled and measured by Compeer Limited and the benchmarked revenue peer group comprises: AJ Bell; Alliance Trust Savings; Barclays Stockbrokers; Equiniti; Halifax Share Dealing; Hargreaves Lansdown; HSBC Stockbrokers; iDealing; Interactive Investor; ITI Capital; Jarvis Investment Management; Norwich & Peterborough Building Society; Saga Personal Finance; Selftrade and Thomas Grant & Co.
Richard Stone, Chief Executive of Share plc, commented:
"The Company is continuing to make good progress. The 20% rise in first quarter revenue relative to the same period in 2017 is encouraging, and reflects both the impact of new partnerships and our own brand activity.
"We continue to build strong foundations for profitable growth and look forward to the future with confidence."
For further information please contact: Share plc |
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Richard Stone, Chief Executive | 01296 439 270 / 07919 220 599 |
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Mike Birkett, Finance Director | 01296 439 479 |
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Cenkos Securities plc (Nominated Adviser) |
020 7397 8900 |
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Mark Connelly / Camilla Hume |
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KTZ Communications (Financial Public Relations) Katie Tzouliadis / Irene Bermont-Penn / Emma Pearson |
020 3178 6378 |
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About Share plc:
Share plc is the parent holding company of The Share Centre Limited and its shares are traded on AIM. The Share Centre started trading in 1991 and provides a range of account-based services to enable investors to share in the wealth of the stock market. Retail services include share accounts, ISAs, Junior ISAs and SIPPs, all with the benefit of investment advice, and dealing in a wide range of investments. Services available to corporate clients include Enterprise Investment Scheme administration and 'white-label' dealing platforms.
For more details contact 0800 800 008, or visit www.shareplc.com or www.share.com
Risk Warning
This document is not intended to constitute an offer or agreement to buy or sell investments and does not constitute a personal recommendation. The investments and services referred to in this document may not be suitable for every investor and if in doubt independent financial advice should be sought. No liability is accepted whatsoever for any loss howsoever arising from any information in this document subject to the rules of the Financial Conduct Authority or the Financial Services and Markets Act 2000. Share prices, values and income can go down as well as up and investors may get back less than their initial investment. The Share Centre is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority under reference 146768.